By Nunatsiaq News
The Kivalliq Hydro-Fibre Link is now estimated to cost close to three times more than originally expected, with federal funding still uncertain.
The expected price tag for the project to connect Nunavut’s electricity infrastructure to the rest of Canada has reached $3.2 billion instead of the initial estimate of $1.2 billion from 2019, John Main, the minister responsible for Qulliq Energy Corp., told the legislative assembly last week.
“Even with much smaller projects on the government side, we’ve seen significant cost escalations in the last couple of years since COVID, which has really impacted our ability to build,” Main said in an interview Thursday.
The project is led by Nukik Corp., which is owned by Kivalliq Inuit Association and its business arm, Sakku Investments Corp.
The link will include a 1,200-kilometre high-voltage transmission line connecting Gillam, Man., to Arviat, Whale Cove, Rankin Inlet, Chesterfield Inlet and Baker Lake and to Agnico Eagle Mines Ltd.’s two gold mines in the region.
The hydro-fibre link is set to bring “renewable and affordable” electricity and high-speed internet to Nunavut, according to the project plan.
“It’s a really a visionary project — something we haven’t seen yet, but not without its challenges in terms of that significant cost and then the different steps that the development would have to go through,” Main said.
Work on Kivalliq Hydro-Fibre Link started in 2018 with an estimated completion date of 2032.
The project is in the development stage. That includes organizers meeting with communities, organizations and governments as well as hiring and training researchers.
Nukik Corp. is seeking support from Ottawa on the project, according to the company’s financial overview.
But Main said there is a “big question mark” as to how much money the Nunavut government will be able to provide, noting that even though Qulliq will be a “large customer” of the link it is “very limited” in its ability to financially support the project.
The federal government has made several funding announcements for the project over the years, including $3 million in 2021, $7 million in 2022 and $2.8 million in 2024.
In April, the Nunavut and Manitoba governments made a “game-changing” statement committing to jointly advance the Kivalliq Hydro-Fibre Link, Main said.
As well, the two governments called for more support from Ottawa, a Nukik Corp. news release said on April 17.
Nukik Corp. estimates the link will bring $8 billion in revenue over 50 years through construction and in mining operations and greatly reduce Kivalliq Region’s reliance on diesel.
The company did not respond to a request for comment on the estimated cost increase.